Shares of BroadSoft Inc. (NASDAQ:BSFT) fell as much as much as 11.8% early Monday, then settled to trade down 8.5% as of 3:30 p.m. EDT, after the company announced mixed first-quarter 2017 results and reduced its 2017 revenue guidance.
Quarterly revenue rose 8.9% year over year, to $79.7 million, including a 10.8% decline in license software revenue, 22.6% growth in subscription and maintenance support revenue, and a 26.3% increase in professional services (and other) revenue. On the bottom line, that translated to adjusted net income of $6.2 million, or $0.19 per share, down from adjusted net income of $11.1 million, or $0.37 per share in the same year-ago period.
Analysts, on average, were looking for lower adjusted net income of $0.16 per share on higher revenue of $80.4 million.
BroadSoft CEO Michael Tessler insisted the company is "pleased" with its first-quarter results.
"We made meaningful progress against our 2017 strategic objectives during the quarter," added Tessler. "Our goals for this year are focused on making our service provider customers increasingly successful in addressing the cloud communications opportunity through a combination of product, sales and marketing-based initiatives."
Looking forward, BroadSoft expects second-quarter revenue of $84 million to $88 million, and adjusted earnings per share of $0.20 to $0.32. Both ranges were below consensus estimates for current-quarter revenue and earnings of $91.7 million and $0.45 per share, respectively.
Finally, BroadSoft told investors to expect full-year 2017 revenue of $380 million to $390 million (down from previous guidance for $390 million to $400 million), and adjusted earnings per share of $2.20 to $2.50 (a reiteration of its previous earnings outlook).
"[F]rom an overall business perspective we remain very positive on our long-term market opportunity," explained BroadSoft CFO Jim Tholen. "Our guidance change is due to a reduction in our professional services and subscription and support revenue expectations."